Najib Danish, spokesman for the Interior Ministry said the source of the explosion was a vehicle belonging to a foreign company but did not name it or specify if the blast was a bombing.
The bomb apparently failed to harm its intended target, believed to be an armored North Atlantic Treaty Organisation convoy that was speeding past.
Security forces inspect the site of an attack in Kabul, Afghanistan, Friday, March 2, 2018.
She said a auto bomb was detonated near a convoy of Australian Embassy vehicles as it was traveling within Kabul.
Some houses were damaged in the explosion, residents of the locality said.
Another interior ministry spokesperson, Nasrat Rahimi, said that it was not clear if there were foreign casualties following the blast.
No militant group has claimed responsibility for the attack.
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Security in the capital has been tightened amid fears of more attacks.
Khan's remarks came two days after Ashraf Ghani offered recognition of the Taliban as a legitimate political group as part of a proposed political process that he said could lead to talks aimed at ending more than 16 years of war.
In late January, a Taliban attacker drove an ambulance filled with explosives into the heart of the city, killing at least 103 people and wounding as many as 235.
"We fully endorse President Ghani's call for the Taliban to join the peace process", Gresback, the North Atlantic Treaty Organisation spokesman, said in his statement.
"Security forces launched a military operation in Imam Sahib district of Kunduz province, on Friday night, killing three militants and injuring four others", Ghulam Hazrat Karimi, a police spokesman in northern provinces, told Xinhua.
Kabul has endured a spike in violence in recent weeks, including a bomb planted in an ambulance which killed more than 100 people.